SA ripe for alternative dispute resolution to take root

Written by Secretary @ Saam

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Published:
05 June 2017

Mediation approach would cost less on all fronts, ease overloaded judicial system and speed up outcomes. If there’s one thing the recent Johannesburg Global Pound Conference will be remembered for — other than its innovative use of technology, including real-time voting on key issues — it’s the sense that the time has come for alternative dispute resolution (ADR) to take root in SA’s civil and commercial dispute resolution spheres.

Speaker after speaker made the point that something has to give in our overloaded and largely adversarial justice system of winners and losers.

As Vasu Gounden, founder of the African Centre for the Constructive Resolution of Disputes, put it: "I think we will reach a turning point in the next 10 years because of two factors: the population explosion and rapid urbanisation. Caseloads will grow exponentially as a result, and ADR will go mainstream."

Adding to the momentum for alternatives are the financial and relationship costs of adversarial dispute resolution. This was extensively discussed at the conference, part of a global series that included other host cities such as Amsterdam, Mexico City, New York, Sao Paolo, Sydney and Toronto.

Constitutional Court judge Edwin Cameron, keynote speaker at the conference, said the costs of corporate conflict were enormous. He referred to a 2006 study in the UK that showed that conflict in British business cost about £33bn a year (less than 20% of which goes to lawyers, interestingly).

Apart from the legal costs and delays in adversarial litigation, some costs are often not quantified, he said. These include the costs of management time and focus and the anger, grief and other emotions invested in win-lose conflict resolution. Combined, these costs are an enormous financial drain on an economy.

The characteristics of processes such as mediation are speed, cost-effectiveness and mutually acceptable outcomes.

The most obvious advantage is the speed with which the mediation process can be convened and concluded. Between 70% and 80% of commercial disputes mediated in London each year are settled in one to two days, and a further 10% to 15% within a few weeks. This is usually achieved at a significantly reduced cost and without further damaging relationships already under strain.

If anything, the case for ADR is even stronger in SA, where access to justice is out of the reach of most citizens and many businesses. Also crucial is to establish commercial ADR as an incentive for foreign investment — investors need to feel confident about the protection of their rights in disputes. In terms of ADR, SA has fallen behind countries such as Mauritius, Namibia and Nigeria and we urgently need to catch up.

That starts with having a solid ADR framework and encouraging — or compelling — the legal community and parties to disputes to take ADR seriously.

The Labour Court is leading the way in encouraging mediation, because it has the authority to refuse to adjudicate a dispute unless it is convinced the parties have attempted mediation. No such requirement is in place for civil high court matters, despite case backlogs.

Price of war: Constitutional Court judge Edwin Cameron said at the recent Johannesburg Global Pound Conference that corporate conflict cost British business about £33bn a year. Picture: KARL ROGERS

The idea of compelling parties in civil or commercial disputes to attempt mediation before litigation sparked intense debate at the Johannesburg Global Pound Conference.

Cautioning against mandatory mediation, Nadine Fourie, an advocate turned mediator, said making mediation a procedural requirement could result in an impoverished version of the process.

Instead of seeing ADR as merely an alternative to litigation, the legal community should see it as a way to defuse disputes before they clog up the courts.

Ebrahim Patelia, founder and CEO of Mediate Works, said there was no harm in forcing people through mediation and he pointed to the access to justice that the Commission for Conciliation, Mediation and Arbitration had brought to poorly resourced workers.

Perhaps the answer lies in not having a one-size-fits-all solution. There are certain disputes that cry out for mediation rather than adjudication and vice versa, and the challenge is to find a balance between compulsion and voluntariness.

There was widespread agreement at the conference that while almost everyone thinks mediation sounds like a good idea, the problem is getting people to do it.

Misconceptions about mediation abound, as the following anecdote told at the event illustrates. In a marital dispute, the legal representative of one of the parties suggested conciliation as a way to resolve it. The lawyer for the other party replied curtly, "My client does not want to reconcile with your client."

The assumption was that mediation is only for restoring a relationship whereas it is just as useful in achieving an agreed end to a relationship.

This level of confusion is perhaps not surprising. As speakers at the conference noted, there is much that business people, lawyers and judges need to learn about mediation. University law faculties and business schools sometimes pay scant attention to ADR; students, if they study it at all, tend to see it as an easy credit.

Dr Ali Chicktay, senior lecturer in the faculty of law at the University of the Witwatersrand, said the legal fraternity had an obligation to change the type of lawyer we produce. New lawyers should not just be rights-focused but also interest-focused, he said, referring to an approach to law that favours collaboration and negotiation as opposed to legal competition.

The suggestion was made that South African children should be taught about mediation and other ADR methods at school, perhaps as part of life orientation. There is much that children can learn, for instance about how to share resources in the playground.

If the predictions that ADR will come into its own in the near future turn out to be true, where does this leave lawyers? Will they find themselves losing clients and shedding work?

The opposite is more likely, judging from the response at the Johannesburg Global Pound Conference. In a real-time vote, external lawyers won the most votes (57%) when delegates were asked who should be responsible for ensuring that parties in commercial and civil disputes understand their process options. The next most popular choice was in-house lawyers (46%), with other stakeholders such as judges, mediators and government departments trailing behind.

Speakers’ comments confirmed that they see a place for lawyers in dispute resolution of all kinds. The point was also made that ADR is not limited to mediation and includes arbitration and hybrid dispute resolution mechanisms.

Michael Murray, legal counsel at Anglo American, said the nature of a dispute determined what dispute-resolution method was warranted. Some disputes leant themselves to litigation and others to mediation.

Neels Claassen, chairman of the South African Medico Legal Association, said the presence of attorneys on behalf of parties at medical negligence mediation was a blessing. They understood the processes and protected clients’ interests, he said, adding there was plenty of scope for lawyers in mediation.

But mediation and other ADR mechanisms are not yet nearly as familiar to South Africans as courtroom processes. Even so, however long it takes for ADR to reach critical mass, change is inevitable. Access to justice depends on and demands it.

Original Article by John Brand

• Brand is a consultant to pan-African law firm Bowmans and director of Conflict Dynamics.